Feds tell Hanford contractor: ‘Don’t spend money unless we OK it’

Employees walk between the High-Level Waste and Pretreatment facilities at the vitrification plant under construction at Hanford. Contractor Bechtel National has new, temporary purchasing restrictions for the plant after issues were identified in a government audit of the company’s subcontracting at Hanford and elsewhere.
Courtesy Bechtel National

Richland, WA

Bechtel National is prohibited from making many large purchases at the Hanford vitrification plant without case-by-case Department of Energy approval after concerns were raised in an audit.

The audit covered all Bechtel National work, which extends beyond the $17 billion Hanford plant under construction to other DOE work at Oak Ridge, Tenn., and Pantex, Texas, and at chemical weapon destruction projects in Colorado and Kentucky.

At the Hanford vitrification plant, Bechtel National, or BNI, issued an internal “compliance bulletin” on July 20 titled “Disapproval of BNI Purchasing System.”

The bulletin said that in the absence of a government-approved purchasing system, Bechtel needs consent from a DOE Hanford contracting officer to award contracts for the vitrification plant with a fixed price of $150,000 or more.

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It also needs consent for agreements without a fixed dollar value, such as those that reimburse subcontractors using federal money based on hours of labor or their costs.

“We will continue this practice as long as the BNI purchasing system remains disapproved,” DOE said in a statement Tuesday.

Bechtel said that it anticipates no impacts to its work at the vitrification plant or its other Bechtel National projects as it works to resolve remaining concerns related to a federal audit.

The Defense Contract Management Agency, under the Department of Defense, conducts periodic audits of Bechtel National and other companies spending government money. It had several findings in a February audit of Bechtel National.

Employees lower a rebar curtain into place at the Effluent Management Facility at the Hanford vitrification plant.
Courtesy Bechtel National

“Like all government contractors, we participate in rigorous, periodic audits of our purchasing systems for government projects,” said Fred deSousa, manager of public affairs for Bechtel’s nuclear, security and environmental work.

“An audit this past February identified concerns with procedures for documenting purchases from subcontractors and notifying the government in a timely way, among others,” he said.

In some of the subcontracts checked by auditors, paperwork was missing that was required to document that the subcontractor had not been suspended or debarred.

Some subcontract files also were missing certification from the subcontractor that federal funds would not be used for lobbying.

Other selected subcontracts didn’t have complete information about how the subcontractor was selected, and the price.

In some cases Bechtel did not follow its policy of giving 24-hour notice to the government field office heading individual projects that it was awarding a subcontract.

The field office for the vitrification plant is the DOE Hanford Office of River Protection.

Bechtel updated it procedures by April, but the DOD notified Bechtel this month that it needed more information and in the meantime its subcontracting and purchasing would need additional oversight.

There was a delay in accumulating enough sample data to validate changes to Bechtel procedures to the government’s satisfaction, deSousa said.

“We will be adding additional documentation to purchases and working with the government to resolve their validation concerns,” deSousa said.

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